Ki­wiSaver’s crys­tal balls

It’s be­come a cen­tral fea­ture of many of our money lives, but not by any means all of them.

That’s shown clearly in a sur­vey done by the coun­try’s largest Ki­wiSaver provider ANZ.

And yet, many of us re­main a bit con­fused about where Ki­wiSaver is tak­ing us.

ANZ asked: ‘‘Have you worked out what your Ki­wiSaver and other sav­ings are likely to amount to by the time you are 65?’’

We an­swered; Yes (35 per cent), No (63 per cent), Un­sure (2 per cent).

Now, I’m not sure how you can be un­sure about whether you have worked that out, but the peo­ple who an­swered ‘‘No’’ might ben­e­fit from a sim­ple Ki­wiSaver hack.

First though, I am­not en­tirely sur­prised by the 63 per cent.

At many points in a hu­man life, build­ing a re­tire­ment nest egg is not among your high­est pri­or­i­ties.

For ex­am­ple, peo­ple with a

GOLDEN RULES

Take sav­ing se­ri­ously Pay off the mort­gage fast Use Ki­wiSaver well mort­gage wouldn’t save any more into Ki­wiSaver than the min­i­mum amount they needed to get their em­ployer con­tri­bu­tions and the gov­ern­ment’s Mem­ber Tax Credit sub­sidy. They di­rect any spare money into build­ing emer­gency sav­ings, and pay­ing off the mort­gage faster.

An­other ex­am­ple is young peo­ple sav­ing up for a house.

They care about get­ting to that magic 20 per cent de­posit, not their wealth at 65.

The fig­ures in­di­cate that’s ex­actly what’s hap­pen­ing.

ANZ found amongst those aged 18-34 the num­ber who have worked it out was 26 per cent, for 35-49 it was 30 per cent and amongst those 50-64, 50 per cent.

I’m sym­pa­thetic to ‘‘uncer­tainty’’. A lot can hap­pen in 20 or 30 years. The last 30 years saw the world lurch to the right, drop taxes, and slash reg­u­la­tion con­tribut­ing to a mas­sive sus­tained rise in share prices.

Who is to say what the next 20 or 30 will hold?

Even so, it’s a good idea to know how you are track­ing so you can ad­just your strat­egy.

‘‘I don’t care’’ seems silly, but

‘‘Many of us re­main a bit con­fused about where Ki­wiSaver is tak­ing us.’’

hon­estly, if you are on re­ally low wages Ki­wiSaver is un­likely to make any dif­fer­ence to you.

If you are amass­ing wealth through prop­erty in­vest­ment or business, you may not care ei­ther.

The cal­cu­la­tors make pro­jec­tions built on a few as­sump­tions (an­tic­i­pated fu­ture re­turns on cash, bonds and shares, and you re­main­ing em­ployed on a ris­ing salary), and mag­i­cally spit out the size of the nest egg you might have at age 65.

They also project the in­come that nest egg might get you.

Might is the op­er­a­tive word in both those previous sen­tences.

Of course the pro­jec­tions will be wrong.

These are not ac­cu­rate crys­tal balls, but they do give you an idea of how you are track­ing, which can be use­ful, and be­comes more use­ful as you get nearer to re­tire­ment.